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UK Spring Budget 2017

Giving immediate reaction to the Chancellor’s Budget, Nick Parker, ICAEW Deputy President, said: “The Chancellor did what he needed to do with a Budget that moved the country one step closer to a post-Brexit economy. Against a backdrop of better than expected economic performance, he has given himself room to manoeuvre should Brexit have more damaging economic consequences than currently forecast. More still needs to be done to encourage business investment, improve productivity and address the state of the public finances – and the Autumn Budget will provide the perfect opportunity to tackle these. With the national debt now at £130,000 per household and the interest bill at £39bn per annum, time is clearly of the essence.”

ICAEW reaction to the Spring Budget 2017

ICAEW reaction to the Spring Budget 2017

ICAEW CEO, Michael Izza's reaction to Philip Hammond's Spring Budget 2017, alongside and initial analysis of the implications the announcements for the economy, taxes, public finances and businesses.

Michael IzzaChief Executive, ICAEW

CEO Blog

In a fiscally neutral speech revealing spending and revenue raising measures across many different areas of government, what is perhaps more interesting is what he didn’t say – rather than what he did. There was little to incentivise businesses to take a longer term view and to get themselves positioned for the post-Brexit economy. Nor did he really tackle the growing regulatory burdens that businesses, particularly small ones, are facing as a result of measures introduced in previous budgets.

Tax

The Spring Budget brought announcements scrapping class 2 NIC, delaying the introduction of Making Tax Digital rules for unincorporated businesses below the VAT threshold and changes to tax reliefs on dividends and on income from rented spare rooms. There is also to be a consultation on the possibility of bringing non-UK resident companies within the scope of corporation tax. This would include the limitations restricting corporate interest deductibility and loss relief.

Business

From a business perspective, the Budget has been mixed news. For those subjected to the increased in business rates from April 2017, there is some relief in the form of £435m to support businesses affected by the business rates relief revaluation. This means no small business that is coming out of small business rates relief will pay more than £600 more in business rates this year than they did in 2016-17. The problem of growing regulatory burdens for businesses, particularly small ones, is still prevalent and will spiral out of control if not tackled head-on.

Economy

While the forecast for public sector net borrowing was revised down in the Budget, Ross Campbell argues that monthly reporting of public sector finance progress serves as noise in the system that distracts from the bigger picture. The truth is that average net national debt is expected to grow to just under £2tn in the next five years. This is the highest level of public indebtedness seen other than in the immediate aftermath of a major world war.

Richard Anning

Much of what was announced in this budget from a tech perspective was expected with investment in fibre broadband, AI and 5G will help keep Britain competitive in a new digital world. New initiatives to improve learning in maths and computer science, a new National Centre for Computing and, reflecting our call for life-long learning.

David Petrie

The allocation of £270m to the new Industrial Strategy Challenge Fund (ISCF) fund makes perfect sense, but only if its investments are made in a radically new way. What's most urgently needed, as we highlighted in our report Boosting Finance for Engineering and Technology, is flexible and sustained funding for Britain’s innovative science-based and creative businesses, over the long-term.

Video analysis

Reaction and expert analysis of the tax announcements in the Spring Budget 2017 from ICAEW's Tax Faculty.

Tune in at 12.30pm on Friday 10 March for a live video broadcast from the ICAEW's Tax Faculty. Technical Managers Anita Monteith, Jane Moore and Sue Moore from the faculty will provide analysis and discussion of the key announcements effecting tax practice and policy from the Spring Budget.

Spring Budget 2017 Report

Technical managers from ICAEW Tax Faculty provide a summary of all the new announcements relating to tax in the Spring Budget of 2017, covering: Making Tax Digital; business and company tax; personal and employment taxes; pensions and savings; VAT and duties; avoidance, evasion and compliance.

ICAEW Tax Faculty provide a comprehensive summary of the announcements relating to tax in the Spring Budget 2017, the final ahead of the trigger of article 50 which will see the UK leave the European Union.

Back to business as usual

In contrast to the dire financial forecast in the Autumn Statement, the UK’s financial situation was much improved – so the Chancellor had an opportunity to make this Budget more like ‘business as usual’, says Frank Haskew, Head of the Tax Faculty.

The Finance Bill 2017 (FB 2017) will be published on Monday 20 March 2017, together with some new consultations. The Tax Faculty will publish a summary of the Bill clauses and of the new consultations and other announcements.